Despite an optimistic outline by former Finance Minister Abul Maal Abdul Muhith, university professors are expressing reservations for Universal Pension Scheme.
Meanwhile, the government is demanding that starting from farmers to day laborers, expats and other professionals are gearing up to receive benefits from the pension scheme.
Since the announcement of the new universal pension scheme for teachers - Prottoy - argument has been ongoing.
Teachers argue they will receive fewer benefits compared to what they were getting before, branding this scheme as "unfair".
"We`re essentially giving back the money we earned. If this scheme is implemented, no pension scheme will work," said Dr Md Akhtarul Islam, President of Bangladesh Teachers` Association Federation.
Loss of benefits: Here are 4 benefits that uni teachers lagged behind
Firstly, teachers stand to lose several benefits. Under the scheme, the employing organisation will deduct a maximum of 10% of the employee`s basic salary or a maximum of Tk5,000, whichever is lower, and will deposit the same amount into the employee`s account.
Both contributions will be credited to the corpus account of government employees managed by the Universal Pension Authority.
This new deposit amount is over 1.67% more than previously required. Consequently, university teachers will lose a significant amount from their monthly salary.
Secondly, due to participation in the new scheme, teachers won`t be able to withdraw a lump sum amount. Previously, they could withdraw half of their total pension amount, which averaged around Tk 70 to 80 lakh (7 to 8 million). From July 1, 2024 they will receive pension payments monthly.
Thirdly, unlike government employees who receive benefits from the General Provident Fund (GPF), teachers do not have this privilege any more. They will not be able to withdraw half of their pension after retirement, as other government employees can still avail and teachers could previously.
Fourthly, teachers will receive fewer benefits compared to bureaucrats, which they deem unfair.
Earlier in 2016, when the National Pay Scale gazette was published, university teachers protested over wage disparities between the bureaucrats and them.
What`s in new scheme?
For example, if a teacher contributes 10% of their salary, which amounts to Tk 2,500 and if he participates in the scheme, his salary will be deducted by Tk 2,500 BDT monthly, and his employer will contribute the same amount.
After serving for 30 years, when he will retire, he will receive a pension of Tk 62,330 per month from the age of 60.
In addition, the amount he paid as contribution to pension scheme will be raised to Tk 9,00,000 in 30 years, and the respective employer institution will deposit Tk 9,00,000 more totalled at Tk 18 lakh (1.8 million BDT).
If he dies at the age of 75, then after the age of 60, he will receive a pension of Tk 1,12,19,400 for that 15 years, which is 12.47 times higher than his deposit.
Since the benefits of the pension will be for a lifetime, there is a possibility of increasing this figure. If the profit rate from the investment increases, the amount of monthly pension will also increase.
According to the announcement, the monthly pension will be determined by calculating the deposit and investment profit of the registered pension fund of the national pension regulator.
As per the deposit of money and the facility of getting interest rate on it will be given and the tax on the pension will be deducted as announced.
How much invested in Universal Pension Scheme so far?
Public university teachers in Bangladesh have initiated an indefinite strike from July 1, 2024, demanding exclusion from the pension scheme, “Prottoy” - newly determined fifth package into Universal Pension Scheme offered by Bangladeshi government since 2023.
PM Sheikh Hasina kicked-off the pension plans on August 17 last year to ensure sustainable and well-organised social security for elderly people that consisted four plans initially.
According to National Pension Authority, the number of registrations stood at 3,03,176 as of June 9, that took the total deposits in the scheme at Tk 86.68 crore (86,68,00,000 aprox). Out of this 866 million Bangladeshi currency, Tk 62 crore (620 million) has been invested at treasury bonds.
Now, the strike of the teachers has led to a complete halt to academic and administrative activities at all public universities.
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